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> it turns into your own home equity so it's money coming out of one pocket and going into the other What if house prices are falling?
by throwaway2037 3y ago
> it turns into your own home equity so it's money coming out of one pocket and going into the other
What if house prices are falling?
- ryandrake 3y agoYour home equity = your property's value minus your loan balance. So even if that value is currently negative, every dollar you pay towards principal increases it. It's not an expense.
- paipa 3y agoYour expense is that you've hitched yourself to an oversized loan, so you're putting money from one pocket to another, except the latter has a hole in it and you have an obligation to keep feeding it. If your cost was only mortgage interest, you'd be happier with 600k outstanding at 1% than 300k at 4% for the same house.